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Doe Authority to Energize the Cross Sound Cable REGIONAL ENERGY RELIABILITY AND SECURITY: DOE AUTHORITY TO ENERGIZE THE CROSS SOUND CABLE HEARING BEFORE THE SUBCOMMITTEE ON ENERGY AND AIR QUALITY OF THE COMMITTEE ON ENERGY AND COMMERCE HOUSE OF REPRESENTATIVES ONE HUNDRED EIGHTH CONGRESS SECOND SESSION MAY 19, 2004 Serial No. 108–83 Printed for the use of the Committee on Energy and Commerce ( Available via the World Wide Web: http://www.access.gpo.gov/congress/house U.S. GOVERNMENT PRINTING OFFICE 93–979PDF WASHINGTON : 2004 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001 VerDate 11-MAY-2000 08:15 Aug 10, 2004 Jkt 000000 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 93979.TXT HCOM1 PsN: HCOM1 COMMITTEE ON ENERGY AND COMMERCE JOE BARTON, Texas, Chairman W.J. ‘‘BILLY’’ TAUZIN, Louisiana JOHN D. DINGELL, Michigan RALPH M. HALL, Texas Ranking Member MICHAEL BILIRAKIS, Florida HENRY A. WAXMAN, California FRED UPTON, Michigan EDWARD J. MARKEY, Massachusetts CLIFF STEARNS, Florida RICK BOUCHER, Virginia PAUL E. GILLMOR, Ohio EDOLPHUS TOWNS, New York JAMES C. GREENWOOD, Pennsylvania FRANK PALLONE, Jr., New Jersey CHRISTOPHER COX, California SHERROD BROWN, Ohio NATHAN DEAL, Georgia BART GORDON, Tennessee RICHARD BURR, North Carolina PETER DEUTSCH, Florida ED WHITFIELD, Kentucky BOBBY L. RUSH, Illinois CHARLIE NORWOOD, Georgia ANNA G. ESHOO, California BARBARA CUBIN, Wyoming BART STUPAK, Michigan JOHN SHIMKUS, Illinois ELIOT L. ENGEL, New York HEATHER WILSON, New Mexico ALBERT R. WYNN, Maryland JOHN B. SHADEGG, Arizona GENE GREEN, Texas CHARLES W. ‘‘CHIP’’ PICKERING, KAREN MCCARTHY, Missouri Mississippi, Vice Chairman TED STRICKLAND, Ohio VITO FOSSELLA, New York DIANA DEGETTE, Colorado STEVE BUYER, Indiana LOIS CAPPS, California GEORGE RADANOVICH, California MICHAEL F. DOYLE, Pennsylvania CHARLES F. BASS, New Hampshire CHRISTOPHER JOHN, Louisiana JOSEPH R. PITTS, Pennsylvania TOM ALLEN, Maine MARY BONO, California JIM DAVIS, Florida GREG WALDEN, Oregon JANICE D. SCHAKOWSKY, Illinois LEE TERRY, Nebraska HILDA L. SOLIS, California MIKE FERGUSON, New Jersey CHARLES A. GONZALEZ, Texas MIKE ROGERS, Michigan DARRELL E. ISSA, California C.L. ‘‘BUTCH’’ OTTER, Idaho JOHN SULLIVAN, Oklahoma BUD ALBRIGHT, Staff Director JAMES D. BARNETTE, General Counsel REID P.F. STUNTZ, Minority Staff Director and Chief Counsel SUBCOMMITTEE ON ENERGY AND AIR QUALITY RALPH M. HALL, Texas, Chairman CHRISTOPHER COX, California RICK BOUCHER, Virginia RICHARD BURR, North Carolina (Ranking Member) ED WHITFIELD, Kentucky TOM ALLEN, Maine CHARLIE NORWOOD, Georgia HENRY A. WAXMAN, California JOHN SHIMKUS, Illinois EDWARD J. MARKEY, Massachusetts Vice Chairman FRANK PALLONE, Jr., New Jersey HEATHER WILSON, New Mexico SHERROD BROWN, Ohio JOHN B. SHADEGG, Arizona ALBERT R. WYNN, Maryland CHARLES W. ‘‘CHIP’’ PICKERING, GENE GREEN, Texas Mississippi KAREN MCCARTHY, Missouri VITO FOSSELLA, New York TED STRICKLAND, Ohio GEORGE RADANOVICH, California LOIS CAPPS, California MARY BONO, California MIKE DOYLE, Pennsylvania GREG WALDEN, Oregon CHRIS JOHN, Louisiana MIKE ROGERS, Michigan JIM DAVIS, Florida DARRELL E. ISSA, California JOHN D. DINGELL, Michigan, C.L. ‘‘BUTCH’’ OTTER, Idaho (Ex Officio) JOHN SULLIVAN, Oklahoma JOE BARTON, Texas, (Ex Officio) (II) VerDate 11-MAY-2000 08:15 Aug 10, 2004 Jkt 000000 PO 00000 Frm 00002 Fmt 6011 Sfmt 0486 93979.TXT HCOM1 PsN: HCOM1 C O N T E N T S Page Testimony of: Blumenthal, Richard, Attorney General, State of Connecticut .................... 45 DeLauro, Hon. Rosa L., a Representative in Congress from the State of Connecticut ................................................................................................ 19 Donahue, Jeffrey A., Chairman and CEO, Cross-Sound Cable Company, LLC ................................................................................................................ 52 Kessel, Richard, Chairman and CEO, Long Island Power Authority .......... 63 King, Hon. Peter T., a Representative in Congress from the State of New York ....................................................................................................... 22 Museler, William J., President and CEO, New York ISO ............................. 49 Otis, Lee, General Counsel, U.S. Department of Energy .............................. 42 Schumer, Hon. Charles E., a United States Senator from the State of New York ....................................................................................................... 4 Shays, Hon. Christopher, a Representative in Congress from the State of Connecticut ................................................................................................ 27 Wood, Patrick, III, Chairman, Federal Energy Regulatory Commission ..... 38 Additional material submitted for the record: Ackerman, Hon. Gary L., a Representative in Congress from the State of New York, prepared statement of ........................................................... 75 Clinton, Hon. Hillary Rodham, a United States Senator from the State of New York ................................................................................................... 75 McCarthy, Hon. Carolyn, a Representative in Congress from the State of New York, prepared statement of ........................................................... 77 Simmons, Hon. Rob, a Representative in Congress from the State of Connecticut, prepared statement of ............................................................ 76 Spitzer, Eliot, New York State Attorney General, prepared statement of ..................................................................................................................... 78 (III) VerDate 11-MAY-2000 08:15 Aug 10, 2004 Jkt 000000 PO 00000 Frm 00003 Fmt 0486 Sfmt 0486 93979.TXT HCOM1 PsN: HCOM1 VerDate 11-MAY-2000 08:15 Aug 10, 2004 Jkt 000000 PO 00000 Frm 00004 Fmt 0486 Sfmt 0486 93979.TXT HCOM1 PsN: HCOM1 REGIONAL ENERGY RELIABILITY AND SECU- RITY: DOE AUTHORITY TO ENERGIZE THE CROSS SOUND CABLE WEDNESDAY, MAY 19, 2004 HOUSE OF REPRESENTATIVES, COMMITTEE ON ENERGY AND COMMERCE, SUBCOMMITTEE ON ENERGY AND AIR QUALITY, Washington, DC. The subcommittee met, pursuant to notice, at 10 a.m., in room 2322, Rayburn House Office Building, Hon. Ralph Hall (chairman) presiding. Members present: Representatives Hall, Cox, Shimkus, Pick- ering, Radanovich, Rogers, Issa, Otter, Barton (ex officio), Boucher, Waxman, Green, and McCarthy. Staff present: Jason Bentley, majority counsel; Mark Menezes, majority counsel; Bob Rainey, fellow; Peter Kielty, legislative clerk; Sue Sheridan, minority counsel; Bruce Harris, minority profes- sional staff member. Also present: Representatives Bishop of New York and Israel. Mr. HALL. It appears that the main ones are present, so we will get underway. Today’s hearing is going to provide us with a very good example of our Nation’s energy problems, and I think we need to pass the Comprehensive Energy Bill. It is about a dispute between two States with implications for regional reliability. The Cross Sound Cable is the first of its kind, merchant transmission project and ap- proved by the Environmental and Siting Agencies of New York and Connecticut. It is approved by the U.S. Army Corps of Engineers. The Public Utility Commissions of both States found that the project would benefit the consumers in their State. When the project was unable to comply with its permits, the owners immediately contacted the appropriate agencies. While most of the agencies were willing to work and work together and try to work out the differences, Connecticut’s response—and they made their decision to shut the project down. Not only did they shut it down completely, the State legislature imposed a morato- rium preventing State agencies from issuing or modifying any new permits for energy projects in that area. They recently reissued the moratorium and apparently intend to keep doing so indefinitely. The result is that the Cross Sound Cable investors can’t nego- tiate with the State to address their problems, and they can’t get permits to do what’s needed to comply with the original permit. They are really left with no recourse. (1) VerDate 11-MAY-2000 08:15 Aug 10, 2004 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 93979.TXT HCOM1 PsN: HCOM1 2 So today, we will hear testimony on the benefits of the Cross Sound Cable and how it has been used over the past 6 months. Following the blackout last August 14, Secretary of Energy used his emergency powers to order the cable put into operation. Testi- mony today will address how the cable was used to stabilize the grid in the northeast and how it can help relieve transmission con- gestion in New York and the New England RTO. When it is all said and done, I think we will see, once and for all, that the Cross Sound Cable will save money for consumers in both New York and Connecticut by improving reliability and reduc- ing the delivered cost of electricity. Because of these benefits, we included a provision in the Comprehensive Energy Bill that now awaits two votes. We need two senatorial votes, just two. We could get them both from New York, perhaps, if we included a provision in the Comprehensive Energy Bill that resolves this dispute in favor of keeping the Cross Sound Cable in operation. It is my strong desire that the appropriate parties in Connecticut and New York—two great States—can come together to reach some kind of agreement. I fear however that Connecticut’s just-say-no
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